2. Forward-Looking Statements
Certain statements contained in this presentation, such as statements concerning the company's anticipated
financial results, current and future product performance, regulatory approvals, currency impact, business and
financial plans and other non-historical facts are quot;forward-looking statements.quot; These statements are based on
current expectations and currently available information. However, since these statements are based on factors that
involve risks and uncertainties, the company’s actual performance and results may differ materially from those
described or implied by such forward-looking statements. Factors that could cause or contribute to such
differences include, among others: the company's exposure to various contingencies, including those related to
Solutia Inc., litigation, intellectual property, regulatory compliance (including seed quality), environmental
contamination and antitrust; successful completion and operation of recent and proposed acquisitions;
fluctuations in exchange rates and other developments related to foreign currencies and economies; increased
generic and branded competition for the company's Roundup herbicide; the accuracy of the company’s estimates
and projections, for example, those with respect to product returns and grower use of our products and related
distribution inventory levels; the effect of weather conditions and commodity markets on the agriculture business;
the success of the company’s research and development activities and the speed with which regulatory
authorizations and product launches may be achieved; domestic and foreign social, legal and political
developments, especially those relating to agricultural products developed through biotechnology; the company’s
ability to successfully market new and existing products in new and existing domestic and international markets;
the company’s ability to obtain payment for the products that it sells; the company's ability to achieve and maintain
protection for its intellectual property; the effects of the company's accounting policies and changes in generally
accepted accounting principles; the company's ability to fund its short-term financing needs; and other risks and
factors detailed in the company's filings with the U.S. Securities and Exchange Commission. Undue reliance should
not be placed on these forward-looking statements, which are current only as of the date of this release. The
company disclaims any current intention or obligation to revise or update any forward-looking statements or any of
the factors that may affect actual results, whether as a result of new information, future events or otherwise.
2
3. Non-GAAP Financial Information
This presentation may use the non-GAAP financial measures of “free cash flow,” ongoing earnings per share (EPS),
and Return on Capital (ROC). We define free cash flow as the total of cash flows from operating activities and cash
flows from investing activities. A non-GAAP EPS financial measure, which we refer to as EPS on an ongoing basis,
may exclude the impact of restructuring charges, charges associated with the settlement of litigation, gains and
losses on the sale of assets, and certain other items. The specific items that are excluded from, and result in, our
non-GAAP EPS financial measure are clearly identified as such in this presentation. ROC means net income
exclusive of after-tax interest expenses, divided by the average of the beginning year and ending year net capital
employed, as defined in the reconciliation at the end of this presentation. The presentation of free cash flow,
ongoing EPS and ROC is intended to supplement investors’ understanding of our operating performance. These
non-GAAP financial measures may not be comparable to similar measures used by other companies. Furthermore,
these non-GAAP financial measures are not intended to replace net income (loss), cash flows, financial position, or
comprehensive income (loss), as determined in accordance with accounting principles generally accepted in the
United States. The non-GAAP financial measures used in this presentation are reconciled to the most directly
comparable financial measures calculated and presented in accordance with GAAP, which can be found at the end
of this presentation.
Fiscal Year
In this presentation, unless otherwise specified, references to Monsanto’s fiscal years refer to the 12-month period
ending August 31. Reference to Emergent’s fiscal years refer to the 12-month period ending September 30.
Trademarks
Roundup, Roundup Ready, Roundup Ready Flex, Bollgard and Bollgard II are trademarks owned by Monsanto
Company and its wholly-owned subsidiaries.
3
4. OVERVIEW
Monsanto Has Established Strategic Platforms in
High-Value Crops
SEED & TRAIT CROP PLATFORMS
SMALL-ACRE CROPS
LARGE-ACRE CROPS
CORN SOYBEANS COTTON VEGETABLE
Branded Licensed Branded Licensed Branded
Branded Licensed ASI
ASGROW EMERGENT*
DEKALB SEMINIS*
DEKALB
ASGROW ROYAL SLUIS*
PETOSEED*
HOLDEN’S/ HOLDEN’S/ COTTON
BRUINSMA*
CORN CORN STATES
ASGROW*
STATES STATES
AMERICAN
SEEDS, INC
BIOTECHNOLOGY
R&D
PLATFORMS
MOLECULAR AND CONVENTIONAL BREEDING
*Pending 4
5. OVERVIEW
Emergent Genetics Is Third-Largest Player in
Key Cotton Markets
UNITED STATES1 U.S. COTTON SEED MARKET: $279M
12%
U.S. BRANDS
52% D&PL
EMERGENT
24% FIBERMAX
OTHERS
12%
INDIA2 INDIAN HYBRID SEED MARKET: $120M
23%
21%
INDIAN BRANDS
NUZIWEEDU
EMERGENT
ANKUR
MAHYCO
10%
RASI
OTHERS
24% 8%
PUBLIC HYBRIDS
8%
6%
1 2
USDA and Emergent Genetics estimates Industry and Monsanto estimates
5
6. OVERVIEW
Acquisition of Emergent Accelerates Growth in
High-Value Cotton Seeds and Traits Market
EMERGENT ACQUISITION
Definitive agreement to acquire Emergent for $300 million,
plus working capital adjustment
Multiple of 15-16 times EBITDA for third-largest U.S. and
Indian cotton seed businesses
KEY FINANCIAL 2004 2005F 2006F
DATA
NET SALES $72M $82M $100M
GROSS PROFIT $34M $39M $47M
GROSS PROFIT 47% 48% 47%
AS % OF SALES
Key financial data based on Emergent actual performance and forecasts for its fiscal year ending Sept. 30
6
7. OVERVIEW
Emergent Repositions Monsanto with a Cotton Seed
Platform and Provides Significant Synergies
Access to quality germplasm and seed market share
EXCELLENT Accelerates penetration of biotech traits and Cotton
FIT States platform
Grows reach of cotton trait business in India
SIGNIFICANT 20 percent reduction in SG&A costs, roughly $5-$6
SYNERGIES million annually, or $40 million on an NPV basis over
four years
Seed market share growth of 1 point annually over next
four years, plus increased trait penetration
Neutral to earnings in 2005, accretive thereafter
ACCRETIVE
Delivers additional free cash flow starting in 2006
Adds to leadership position in global seeds and traits
STRATEGIC
Continues trend of greater contribution to profitability
from seeds and traits segment
7
8. MARKET LEADERSHIP
Emergent and Cotton States Mirror Monsanto’s Market
Approach for Corn
BRANDED PLATFORM
DEKALB
EMERGENT
ASGROW •Access to quality germplasm
•Brand recognition in important
markets
•Seed and trait share growth
LICENSING PLATFORM
COTTON
• Growth through seed breeding
HOLDEN’S enhancements
STATES
• Trait value capture through enhanced
marketing channels
• Rapid penetration of future
technology advances
8
9. MARKET LEADERSHIP
Emergent Has Held U.S. Market Share Over Last Six
Years; Clear Opportunity to Drive Growth
U.S. COTTON SEED MARKET SHARE
100%
80%
60%
40%
20%
0%
1999 2000 2001 2002 2003 2004
EMERGENT FIBERMAX
PHYTOGEN DELTA & PINE LAND
OTHERS
Source: USDA, based on planted acres
9
10. MARKET LEADERSHIP - BIOTECHNOLOGY
Molecular Breeding Used To Create New Source of
Seed for U.S. Cotton Farmers
KEY MARKET AREAS U.S.
TARGET MARKET 7M-8M
Cotton States
CREATING VALUE
PERCENT PENETRATED 0%
Germplasm licensed from third parties and developed through
• Rapid and broad molecular breeding by Monsanto
introduction of
Seed production under way for commercialization in 2006
traits and future
innovations
Cotton States launching exclusively on a second-generation trait
• Licensing fee
platform
reflects value of
2004 COTTON STATES FIELD TRIALS
top quality
germplasm, 1,600
separate from
value of trait
1,500
• Cotton seed
LBS LINT/ACRE
currently sells
1,400
for average of
$20 per acre
1,300
1,200
COTTON STATES COMPETITIVE
VARIETIES VARIETIES
DISCOVERY PHASE I PHASE III
PHASE II PHASE IV LAUNCH
Proof of Concept Adv. Development
Early Development Pre-Launch
10
11. MARKET LEADERSHIP -- BIOTECHNOLOGY
Cotton Market Already Has Shifted to Stacked Offering;
Emergent Can Accelerate that Trend in its Brands
U.S. MONSANTO COTTON TRAIT ACRES
12 BOLLGARD & STACKED
ROUNDUP READY
BOLLGARD II
ACRES (MILLIONS)
9
6
3
0
1998 1999 2000 2001 2002 2003 2004 2005F
11
12. MARKET LEADERSHIP - BIOTECHNOLOGY
Added Flexibility Means Better Weed Control, Greater
Value in Cotton
KEY MARKET ACRES U.S. AUSTRALIA
Roundup Ready AVAILABLE MARKET 10-15M 0.5-0.8M
Flex Cotton
CREATING VALUE
0% 0%
PERCENT PENETRATED
Expanded window of over-the-top application for more
• Additional value “flexible” weed control
for the Roundup
Ready Flex trait Increased grower convenience
while offering
Reduced need for specialized spray equipment
most growers a
similar or lower
Eight cotton seed companies currently breeding trait into
total system
varieties
cost
• Roundup Ready
Flex Cotton will
be available with
Bollgard II,
which also
should boost
Bollgard II
adoption
DISCOVERY PHASE I PHASE III
PHASE II PHASE IV LAUNCH
Proof of Concept Adv. Development
Early Development Pre-Launch
12
13. OVERVIEW
Monsanto Has Established Strategic Platforms in
High-Value Crops
SEED & TRAIT CROP PLATFORMS
SMALL-ACRE CROPS
LARGE-ACRE CROPS
CORN SOYBEANS COTTON VEGETABLE
Branded Licensed Branded Licensed Branded
Branded Licensed ASI
ASGROW EMERGENT*
DEKALB SEMINIS*
DEKALB
ASGROW ROYAL SLUIS*
PETOSEED*
HOLDEN’S/ HOLDEN’S/ COTTON
BRUINSMA*
CORN CORN STATES
ASGROW*
STATES STATES
AMERICAN
SEEDS, INC
BIOTECHNOLOGY
R&D
PLATFORMS
MOLECULAR AND CONVENTIONAL BREEDING
*Pending 13
14. FINANCIAL GROWTH
Growth of Monsanto’s Ongoing Business Is
Accelerating, Generating Significant Free Cash Flow
MONSANTO ONGOING EPS MONSANTO FREE CASH FLOW
BEFORE ACQUISITIONS BEFORE ACQUISITIONS
15%
$3.00 growth $1,200
15%
growth
$2.50
$1,000
$ MILLIONS
$2.00 $800
$1.50 $600
$1.00 $400
$0.50 $200
$0.00 $0
2003 2004 2005F 2006F 2007F 2003 2004 2005F 2006F 2007F
14
15. FINANCIAL GROWTH
Emergent’s Gross Profit Growth Rate Parallels
That of Monsanto’s Seeds and Traits
GROSS PROFIT
MONSANTO
EMERGENT SEEDS AND TRAITS
$2,000
R
CAG
R
CAG
$50
18%
15% $1,500
$40
$ MILLIONS
$ MILLIONS
$1,000
$30
$20
$500
$10
$0
$0
2001 2002 2003 2004 2005F 2006F 2001 2002 2003 2004 2005F 2006F
Source: Emergent estimate; Monsanto estimate
15
16. FINANCIAL GROWTH
Acquisitions of Seminis and Emergent Add to EPS and
Free Cash Flow Forecasts
MONSANTO PRO FORMA MONSANTO PRO FORMA FREE
EPS FORECAST CASH FLOW FORECAST
$3.50 $1,200
20%-25%
growth
$3.00 $1,000
17%
growth
$2.50
$800
$ MILLIONS
$2.00
$600
$1.50
$400
$1.00
$200
$0.50
$0
$0.00
2003 2004 2005 2006F 2007F
2003 2004 2005F 2006F 2007F
16
17. FINANCIAL GROWTH
Emergent Acquisition Creates Significant Synergies
for the Combined Business
U.S. SEED & U.S. trait long-term value capture
TRAIT
U.S. trait value-based pricing
VALUE
GROWTH U.S. share gains in seed and traits
OPERATIONAL Sales force integration
SYNERGIES
Back office integration
Increased research efforts and elimination of
TECHNOLOGY
redundancies
ENHANCEMENTS
Rapid demonstration of trait value in marketplace
17
18. FINANCIAL GROWTH
Free Cash Flow Guidance Increases But Offset by
Funding for Acquisitions
Free Free cash guidance
Cash
$1,000
from ongoing business
Seminis
$800M
before acquisitions in
2005 increased to
$800M; $(1.7B) cash
$500
use for acquisitions
$MILLIONS
Emergent
Current $500M share
repurchase program
$0
will continue;
scheduled completion
In July 2006
($500)
Dividends will
$(600M)
continue to be
considered to return
($1,000)
$(900M) additional value to
shareowners
Seminis and Emergent acquisitions to be funded with
current cash balances and short-term borrowings
18
19. MARKET LEADERSHIP
Monsanto Has Established Strategic Platforms in High-
Value Crops
SEED & TRAIT CROP PLATFORMS
SMALL-ACRE CROPS
LARGE-ACRE CROPS
CORN SOYBEANS COTTON VEGETABLE
Branded Licensed Branded Licensed Branded
Branded Licensed ASI
ASGROW EMERGENT*
DEKALB SEMINIS*
DEKALB
ASGROW ROYAL SLUIS*
PETOSEED*
HOLDEN’S/ HOLDEN’S/ COTTON
BRUINSMA*
CORN CORN STATES
ASGROW*
STATES STATES
AMERICAN
SEEDS, INC
BIOTECHNOLOGY
R&D
PLATFORMS
MOLECULAR AND CONVENTIONAL BREEDING
*Pending 19
20. Reconciliation of Non-GAAP Financial Measures
Reconciliation of Free Cash Flow
12 Months Ended
Fiscal Year 2006 12 Months Ended
Fiscal Year 2007 Fiscal Year 2005
$ Millions Aug. 31, 2003
Target Aug. 31, 2004
Target Target
Net Cash Provided (Required) by Operations $1,100 $1,200 $1,261 $1,128
$1,000-$1,100
Net Cash Provided (Required) by Investing Activities $(482)
$(300) $(300) $(2,100) $(262)
Free Cash Flow $700-$800 $800 $(900) $999 $646
Net Cash Provided (Required) by Financing Activities N/A N/A N/A $(243) $(502)
Net Increase (Decrease) in Cash and Cash Equivalents N/A N/A $756 $144
N/A
Reconciliation of Non-GAAP EPS
$ per share 12 Months Ended 12 Months Ended 12 Months Ended
12 Months Ended 12 Months Ended
Aug. 31, 2006
Aug. 31, 2003 Aug. 31, 2004 Aug. 31, 2005 Aug. 31, 2007
Net Income (Loss) $0.26 $0.99 $0.71-$0.93 $2.13 - $2.30 $2.45 - $2.65
--
-- --
$0.05 --
Cumulative Effect of Change in Accounting Principle
$2.45 - $2.65
Income (Loss) Before Cumulative Effect of Accounting Change $0.99 $2.13 - $2.30
$0.31 $0.71-$0.93
--
--
$0.36 --
Restructuring Charges -- Net $0.10
--
2004 Discontinued Operations and Related $0.02 -- --
$0.05
Restructurings-- Net -- --
Goodwill Impairment Charge for Global Wheat $0.24 -- --
Business
-- -- --
--
Estimated Purchase Accounting Adjustments $0.78 -- $0.85
-
-- --
--
Tax Benefit on Loss from Sale of European Wheat and -- $(0.39)
Barley Business
-- -- --
$0.96 $0.68
Solutia-Related Charge
$1.42 $2.45 - $2.65
Net Income (Loss) from Ongoing Business $1.61 $1.85 - $2.00 $2.13 - $2.30
20
